Housing affordability up in California with home price decline

Fifty-one percent of California households could afford a single-family home priced at the median, according to the California Assn. of Realtors. That was an increase from 46% during the same period last year, when buyer tax credits fueled the market and pushed up prices. Affordability decreased from the prior quarter, but that was due to seasonal variations that pushed up prices.

Potential buyers needed to earn a minimum annual income of $63,080 to qualify for the purchase of a home priced at the state’s median, $293,580, which is the price at which half the homes sold for more and half for less. The house payment on that purchase, including taxes and insurance, would be $1,580, the group reported, assuming a down payment of 20% and an effective composite interest rate of 4.85%.

During the second quarter, affordability fell in the priciest parts of the state. San Bernardino County was the most affordable in the state, with a rate of 77%, while San Mateo County was the least affordable, with only 21% of households in the state able to afford that county’s median-priced home, the group reported.